When E.T. the Extra-Terrestrial hit the silver screens in 1982, the movie was a sensation. It quickly shot past Star Wars to take the lead as the highest-grossing film to date. Nearly 40 years later, it is still the 7th-highest-grossing film of all time on the inflation-adjusted list.
Many companies sought to hitch their merchandise to E.T.’s rising star. Countless products — official and unofficial — lined the shelves. For the most part, consumers were more than happy to grab up anything associated with the adorable little alien. (Editor’s Note: We use the word “adorable” to refer to E.T.’s personality, not his appearance. Truthfully, if we saw anything that looked like that wandering through our backyard in the middle of the night, we’d kill it with a stick.)
Not all companies were able to capitalize on the movie’s success. For gamers, E.T. is synonymous with historically bad ideas. Atari’s E.T. video game, as detailed in this article, is classified by many as the worst ever created and was almost single-handedly responsible for the great video game crash of 1983 and Atari’s fall from the pinnacle of the industry.
If Atari executives curse the day they first heard of E.T., there is another company that desperately wishes it could go back and time and correct its decision not to associate with the little alien.
There is another one that thanks its lucky stars for the visitor from beyond the stars.
One of the most recognizable and well-loved confectionery treats is M&M’s® chocolate candy. The iconic candy-covered chocolate discs are a product of Mars, Inc. More than 400 million individual candies are produced and sold each day, generating $712 million in sales in 2020. The product consistently tops the charts in annual sales of candy.
Amblin Productions, the makers of E.T. the Extra-Terrestrial, approached Mars with a proposal to tie M&M’s into the film. That offer was rejected. To this day, the record is a bit fuzzy about the rationale behind this decision. Some say company executives didn’t like the script. Others say that marketing consultants discouraged association between M&M’s and an alien life form. Whatever the reason, Mars made it clear that the answer was no. Amblin went looking for someone else.
The second choice was The Hershey Company. Ironically, it was Hershey that developed the process used by Mars to create M&M’s. The process is called panning. The first such product was the Hershey-ets. These candies resembled modern M&M’s (minus the “m” on the shell). The product never caught on, however. Once M&M’s hit the shelves, the only way Hershey-ets could be described was by comparing the product to its principal competitor. Aside from seasonal marketing, Hershey-ets fell out of the starting lineup.
In the mid-70s, Hershey started developing a variation of Hershey-ets. The distinctive feature of this new product was a peanut-flavored center instead of milk chocolate. Named Reese’s Pieces, it was introduced in the United States in September 1978. It generated impressive sales initially, but that soon plateaued and began to decline. The decline wasn’t quite at the panic-inducing level, but it was certainly disturbing and did not bode well for the company’s hopes.
It was at this time that Amblin approached Hershey about a possible association with E.T. the Extra-terrestrial.
The concept was simple. At no cost to Hershey, Reese’s Pieces would be featured in the film to lure E.T. into a home where he becomes close friends with a boy. In return for this product placement, Hershey would commit to $1 million of advertising for Reese’s Pieces, simultaneously promoting E.T. The Extra-Terrestrial. Before Amblin’s representatives could complete the proposal, Hershey executives pounced on it.
Jack Dowd was the Hershey executive who committed to the deal. In a 1991 oral history interview, he recalled the experience:
So I came home and informed Earl Spangler (Hershey Chocolate president) and the staff that we were going to spend a million dollars on a movie that I couldn’t show them the script for, that was going to employ a little green creature from outer space, and I couldn’t show them–at that point, it was still confidential–I couldn’t show them a picture of that either. I hadn’t seen it either. I didn’t know what it would look like.
Earl said, “Are you sure this is going to work?”
And I said, “Oh, sure.” Because what else could I say? If I said, “Oh, no,” then we’d have to cancel it and I’d already signed up for it.
We were going to offer a tee-shirt that had a picture of E.T. We wanted a picture, and they sent us a picture of E.T. and the little boy. I proudly showed the picture at the staff meeting, and Earl [Spangler] said, “That is the ugliest creature I have ever seen in my whole life.” There’s no answer to that. You just sit quietly and let the eruption die down.
There was a special screening of the movie in the Hershey Lodge theater shortly after it premiered in New York City. The theater was filled with employees and their families.
At the end, the screen went black and there was total silence. Nobody seemed to want to get off the mountain; they wanted to stay up there. And then there was enormous applause.
So I ran out in the lobby to watch the faces of the people that came by. Many of them were tear-stained. And Earl, who is a very emotional man, came out and his eyes were quite moist, and I said, “Is he still ugly, Earl?”
And Earl said, “Ah, he’s beautiful.” And that was one of the high spots of the whole performance.
The E.T. deal was a game-changer for Reese’s Pieces. Fans, eager to latch onto anything associated with the film, gobbled up their favorite alien’s favorite food in record numbers. Within two weeks of E.T.’s premiere, candy sales spiked by 65-85%. Dowd concluded that his $1 million investment resulted in $15-20 million worth of promotion for the brand.
Today, the alien and the candy are inseparable in the hearts and minds of movie aficionados and candy lovers, alike. Although Reese’s Pieces was the second choice for the producers of E.T., it ended up being one of the most successful product placements in the history of advertising.